Thirty patients with chronic renal diease -10 with polycystic kidney disease (PKD) and normal GFR; 10 with PKD and GFR is less than 30 ml+min; 10 with chronic glomerulonephritis (CGN) and GFR is less than 30 ml+min -and 10 normal subjects were investigated. The ability to concentrate urine maximally (T-CH2O) after water deprivation and the renal handling of water and electrolytes following hypertonic volume expansion were studied. A defect in T-CH2O was common in PKD patients even with normal GFR. In PKD patients with normal GFR, volume expansion was not followed by a natriuretic effect of the same magnitude as in controls. This ""inadequate natriuresis after volume expansion"" may be explained partly by chronic hyponatremia and partly by a functional defect, i.e. the incomplete arterial vasodilation in the kidney. At comparable degrees of renal insufficiency, T-CH2O was lower in PKD than in CGN patients. It seems likely that in PKD patients the increased endogenous osmotic load has exaggerated the tubular defect in urine concentration already present at normal GFR. Furthermore, volume expansion was followed by a significant increase in fractional sodium excretion only in PKD patients with renal insufficiency.